An Investor’s Guide to Selecting A P2P Lending Platform


Investing is kind of intimidating especially for beginners. This is because you will need more capital and more knowledge to manage it successfully. However, if you are looking for a quick, easy and small starting capital, you can consider investing in P2P lending. P2P lending or peer-to-peer lending allows you to lend money directly to borrowers.
Through a P2P platform or HittaSMSLån, investors and borrowers are connected. As an investor, you can choose how much you want to invest and what type of loan to offer. The platform will then pair you with borrowers. This gives you flexibility when it comes to choosing ideal borrowers. P2P lending will efficiently remove typical intermediaries like credit unions and banks.

The best thing about P2P lending is it boosts returns for investors. If you look at the average returns of different investments, you will start to realise that P2P lending offers more returns. For instance, real estate investing has 6.5% returns while stocks offer 7% returns. You will be surprised to know that P2P lending offers 8 to 13% returns.
If you want to consider this, you should research your options before finally committing any capital. Here are some guidelines for selecting a P2P platform:

Background of the team
The first thing that you should consider is the background of the team. Check the experience of the team when it comes to finances and managing loans. Their experience trained them to identify what types of loans or borrowers to avoid.

Transparency of the platform
The next thing to do is to check the overall track record of the platform. If the information is transparent, you can know its investment performance. You should not be so quick to judge though. Although past performance is not a forecast of future results, you can use it to decide what is worth to invest.


The processes of the platform
In anything, due diligence is required. Through this, you can get a clear idea of what a thing is all about. In the case of P2P lending, you should check how the security is valued. On top of that, you should know the default and even the recovery processes that are in place. Additionally, you should check the underwriting process.

Check what customers are saying
The good news is that most platforms feature customer reviews. It will be to your advantage if you take a look at both the reviews (of customers) and responses (of platform). This is how you can determine the professionalism of the platform and how they value the customers and other partners.

Talk to the platform directly
If there is something that you need to clarify, you should not hesitate to talk directly to the platform. Face-to-face interaction is ideal but if it is not possible, at least call the platform to get a feel of the people behind it.
At the end of the day, the P2P platform should support your interests and protect your investments. It is important to evaluate the best platform before you dip your toes in this kind of investment.